Premier Daniel Andrews reveals why office workers won’t return to Melbourne’s CBD

In a devastating blow to the CBD, Premier Daniel Andrews says thousands of workers aren’t likely to return to the city after Covid. Here’s why.

Tens of thousands of workers will never return to the city centre.

In a devastating blow to Melbourne’s CBD, Premier Daniel Andrews says just 60 per cent of workers are likely to return to the city after Covid.

Mr Andrews, who oversaw the world’s longest lockdown and advised people to work from home for more than a year in between the shutdowns, said workers’ lives have changed.

The Premier’s comments have been condemned by business groups, who accused him of giving up on a viable back to work plan.

Small Business Australia executive director Bill Lang said: “At a time when the city and Victorians need positive and hopeful vision of coming back, the government has waved the white flag.

“What we need is a believable and achievable plan, not more division between the regions, suburbs and the CBD.”

The city was a ghost town during lockdowns. Picture: Andrew Henshaw

Prominent Melbourne restaurateur Chris Lucas said the city was in grave danger of losing its global reputation and being overtaken by Sydney and Brisbane.

Mr Lucas called on the Premier to start promoting positivity in a bid to build the CBD back to its former glory.

“His views only further add to the negativity that is damaging Melbourne’s brand and killing thousands of small businesses,” Mr Lucas said.

“As a global city and the largest single economy in the state, it’s almost impossible to sustain a notion that a metropolis of our size can somehow operate at 50 per cent and compete with Sydney and Brisbane.

“It’s a case of ideology ahead of common sense”.

Before Covid-19 the CBD had an estimated weekday office population of 250,000.

The Premier’s comments came during his first speech to the Committee for Economic Development of Australia since 2019.

“I think there are some changes that are going to be quite permanent, if not, they’ll certainly linger for a while,” Mr Andrews said.

An estimated 250,000 workers were coming into the CBD prior to the pandemic. Picture: David Geraghty

“I think the days of having 100 per cent of people at their desk 100 per cent of the time, in the CBD and in CBDs in the suburbs or regional cities, I don’t know about that.

“I think that working from home works very well for some people some of the time. We estimate we’re going to finish up with about 60 per cent back.

“I talk to big employers, particularly in the CBD, they’re probably more like the 50 per cent mark.”

David Southwick, opposition spokesperson for CBD Recovery, called on the government to set better targets to get people back to work.

“Before the Premier trumpets wind power targets, he should be showing much needed leadership by setting more inspiring targets to rebuild our shattered city,” he said.

“His vision is short sighted. We need far more optimistic efforts to help our city recover.

“The Premier should be leading by example and encouraging public servants back to city.” Lord Mayor Sally Capp, who has led the charge in trying to get workers back into the city, did not directly address the Premier’s comments on Friday.

“There’s no doubt there’ll be a new rhythm to the city as many people choose to embrace flexible working,” she said.

Premier Daniel Andrews said the days of having 100 per cent of people at their desks 100 per cent of the time were over. Picture: Nicki Connolly

“The new Covid-normal also offers exciting business opportunities in the future. We will be on the hunt to secure more company headquarters in our CBD.”

Victorian Chamber of Commerce and Industry chief Paul Guerra said he expected most offices to allow workers to stay home two days a week.

“We know there are many advantages to being in the office,” he said.

“A hybrid arrangement can work positively for both the organisation and the individual and it will be up to each organisation to have that conversation with management and teams.”

Property Council of Victoria executive director Danni Hunter said: “The quicker we get people back to the CBD, the quicker our city will come back to life.”

CBD RECOVERY SUMMIT

A summit of business and government leaders to discuss ways to revitalise the CBD will be hosted by City of Melbourne on March 17.

Lord Mayor Sally Capp, state Treasurer Tim Pallas, and Deloitte Access Economics lead partner Dr Pradeep Phillip will be guest speakers.

Ms Capp said the city council was leading the charge to get workers back into city offices. “Because everyone who returns is helping to revitalise our economy, and support jobs and businesses,” she said.

“This summit is a great opportunity to bring together the most influential leaders in Melbourne, from CEOs to business owners and government – all who are invested in the future of our city.”

“This summit is about sharing insights, gathering data and agreeing on actions that will earn the commute of workers, and turbocharge the engine of Victoria’s economy – not just for the next few months, but for the next 10 years.”

Victorian Chamber of Commerce and Industry CEO Paul Guerra said the state’s strength was its people.

“And people are the lifeblood of Melbourne’s CBD. We need everyone focused on how we roar back from the pandemic, and this summit is another great step in that direction.”

“The Victorian Chamber is focused on ensuring Victoria is the best place to do business, and that ambition is going to take collaboration, and a partnership between business and all levels of government to achieve.”